The world is opening up and the real estate market is bouncing back to its pre-pandemic ways. Life in the Big Apple is not cheap. Now with the implementation of a new rule, it might seem impossible to rent an apartment in the city. If you’re moving to NYC, or are already a seasoned renter, let’s explore what the 40x rent rule means, and how you can get around it. In this guide, we’ll answer your burning questions about the requirements to rent an apartment in NYC. There’s still hope! We’ve made a list of the 6 ways you can lock down an apartment even if you don’t meet the criteria of the 40x rent rule in NYC. Let’s dive in!
What is the 40x Rent Rule in NYC?
According to the NY Times, the median rent in Manhattan has bounced back to just above $3,000. This means New Yorkers should make more than $120,000 per year to afford this price. This figure is 40 times the median monthly rent. Additionally, you and your roommates (if you have them), must maintain good credit to secure the apartment of your dreams.
What’s the Problem with 40 Times Rent?
New Yorkers simply don’t make as much money as they need to be approved to rent certain homes. Let’s take a quick look at the statistics related to the 40x rent rule in NYC:
- The US Bureau of Labor Statistics suggests that an average, full-time employee earns approximately $51,480 per year.
- This means that their monthly income is about $4,200 per month.
- So, if $3,000 goes towards the monthly rent payments, New Yorkers only have a a little over $1,000 left. This amount doesn’t account for utilities and personal expenses, pet care, among others.
6 Ways to Get Around the 40x Rule Rent in NYC
Did you know that New York City’s housing expenses are 369% higher than the national average? So, how can you rent an apartment if you don’t meet the rule of 40 times rent?
1. ‘Tis the Season for Moving to NYC
Are you thinking of moving to NYC? Traditionally, winter is a slow time for rentals. The city experiences a high volume of apartment shoppers in the summers, for example, international students living off-campus.
Therefore, in the winters, landlords might be more open to renting to you if you are just below the income threshold.
TIP: This is the perfect time to move to NYC while everyone else gets busy with Christmas shopping!
2. Look for Roommate(s)
The more people there are on your apartment lease, the lesser you’ll pay in monthly rent payments individually. However, this doesn’t mean that you should rent a 1-bedroom apartment and have ten roommates.
Depending on the layout of apartments, three or four tenants might consider renting a two-bedroom to split the high rent. In the case where two out of the four renters have good financials, they could be leaseholders. Then, a roommate agreement can be drawn up amongst the tenants explicitly stating who is responsible for what expense.
3. Tighten Up your Credit Score
Landlords have different criteria when it comes to credit scores. Most are looking for a number around 700. However, they might be willing to look beyond the score if the apartments need to be filled.
How to improve your credit to get around the 40x rent rule in NYC:
- The most obvious way to improve your credit score is by paying existing debts. This is especially important for renters who have exceeded 15%-30% of their available credit.
- If you have errors on your credit report, make sure they are corrected. Furthermore, you might want to consider getting letters of explanation for any major issues like bankruptcy.
- Finally, If you don’t have a credit history, open some credit cards and start making regular, on-time payments.
4. Search for an Accommodating Landlord
Searching for a flexible landlord is incredibly important if you don’t meet the requirements of the 40x rent rule in NYC. You might be able to negotiate with small landlords or condo owners because they aren’t large real-estate corporations. You can often negotiate rental terms and conditions with smaller landlords one-on-one. Not only that, but they might even be able to provide a co-signer if necessary!
TIP: Search on real estate listing sites for homes that accept guarantors and those owned by individual owners.
5. The Affordable Housing Lottery
The city provides affordable housing for low-income families, the elderly, and the disabled. Are you willing to play a long game here? Then this clever resource might help you get around the 40x rent rule in NYC. The NYC Housing Connect is an official government portal to find affordable apartments across the five boroughs. Once the application process is completed, it can take years to secure a spot in the system. However, there are success stories, like Elsie Rivera’s below. She won a 1-bedroom apartment for $177/month in Lower East Side, Manhattan.
6. Explore Co-Living Spaces in NYC
Co-living spaces are essentially “adult dorms”. While this proposition might not be tempting at first, it’s a neat way to get around the 40x rule rent in NYC. Regardless, there are upsides to exploring co-living alternatives! These dorms offer the convenience of a furnished apartment with staples in the pantry and pre-selected roommates.
Make sure the company that lists co-living places is operating legally. Otherwise, you’re at risk of your house being shut down without notice!
Get Renting with Roomi!
The 40x rent rule in NYC might make renting an apartment in the city seems impossible. But don’t lose heart! There are legal systems in place to help you find affordable housing, with extra help for the elderly or disabled. Make sure you thoroughly research your options and readjust your expectations about living in the Big Apple. Browse safe and credible listings on the best room finder portal, Roomi!